Bethesda Says Obsidian Will Keep Creative Independence Under New Reporting Structure
Bethesda says Obsidian Entertainment will retain its creative identity and existing leadership after Microsoft moved the studio under Bethesda as part of the latest Xbox restructuring. In an internal memo from Bethesda President Jill Braff, the change is described primarily as a new reporting structure rather than an integration of Obsidian into Bethesda Game Studios. Feargus Urquhart and Obsidian’s existing leadership will continue running the studio, while Bethesda Game Studios remains responsible for the Fallout franchise itself.
“Hi everyone,
Following the note from Matt, I wanted to share more on today’s news and what it means for our collective teams.
I’ve had the opportunity to get to know Feargus Urquhart and his team over the past six years, and I have great respect for what they’ve built. Obsidian has extraordinary creative talent, deep expertise, and a long history of creating memorable games and experiences. I’m looking forward to working more closely with them.
Today’s announcement is primarily a change in reporting structure. The creative identity and strengths that make Obsidian distinct will remain at the core of their studio and work.
Feargus and the Obsidian leadership team will continue to lead Obsidian, with the studio reporting to me. Bethesda Game Studios will continue to lead the Fallout franchise. Together, the teams will build on their longstanding relationship and the early work already underway on a new Fallout project, with more to share in the months ahead. This structure supports the franchise-led model we’ve been strengthening while keeping accountability for both the studio and the franchise clear.
I also recognize that employees across our studios, publishing, and business teams will have questions about what this means for our current priorities, roadmap, and responsibilities. To be clear, we’re not resetting our roadmap or asking teams to change what they’re focused on. We’ll take the time to understand how teams can best support one another, and where closer partnership can benefit our players and fans. We’ll continue communicating as we progress.
I’m looking forward to spending more time with the Obsidian team and building on the strong foundation already in place across our organizations.
Welcome Feargus and team – more soon!”
The memo provides more detail on a change Microsoft officially announced on September 22, when Xbox said Bethesda would expand its responsibilities to include Obsidian. Microsoft confirmed that Obsidian will continue its current projects, including Grounded, while also developing a new Fallout project in collaboration with Bethesda Game Studios. Xbox restructuring, which also moved Rare and World’s Edge under Activision and combined Playground Games with Turn 10.
Braff says Obsidian’s creative strengths will remain central to the studio and that the new structure is intended to clarify responsibility between the developer and Bethesda’s franchise leadership. Bethesda Game Studios will continue leading Fallout overall, while the 2 teams build on work already underway for Obsidian’s new Fallout project. More information about that game is expected in the coming months, but Bethesda has not announced its title, setting, platforms, release window, or whether it is connected directly to Fallout: New Vegas.
The move also leaves Bethesda’s previously announced development roadmap unchanged. The Elder Scrolls VI remains Bethesda Game Studios’ main production priority, Fallout 5 is in preproduction, Fallout 3 and Fallout: New Vegas remasters remain planned, and Starfield will continue receiving support. Obsidian’s separate Fallout project sits alongside that roadmap rather than replacing Bethesda’s own future Fallout work. We previously detailed the current Fallout development lineup, including the distinction between Obsidian’s project and Fallout 5.
Bethesda’s reassurance does not completely settle questions about how much autonomy Obsidian will retain in practice. Later reporting indicated that some employees inside Obsidian are concerned the new reporting relationship could reduce the independence the studio previously had under Xbox Game Studios. Bethesda’s official position is the opposite, promising that Obsidian’s identity and leadership will remain intact. For now, the confirmed change is organizational oversight, not the disappearance or absorption of Obsidian as a separate development studio.
Moving Obsidian under Bethesda makes the most immediate sense through Fallout. Microsoft now has the studio behind Fallout: New Vegas working on a new entry while Bethesda Game Studios retains control of the franchise and develops its own long term Fallout roadmap. Putting both groups within the same reporting structure could simplify coordination without necessarily requiring Obsidian to become another Bethesda Game Studios team.
The real test will be whether the promised creative independence survives normal production decisions. Bethesda’s memo is clear about keeping Obsidian’s leadership and identity, but organizational structures ultimately matter through budgets, schedules, approvals, and project selection. The new Fallout game will probably be the first major example of how much freedom Obsidian actually retains under the new arrangement.
Do you think moving Obsidian under Bethesda will strengthen its new Fallout project, or are you concerned the studio could gradually lose some of its creative independence?
